On July 1, YUKOS was served with an additional RUR 98bn ($3.4bn) tax bill for the fiscal year 2001, according to the Tax Ministry. The claim is based on the inspection of the company’s tax payments for 2001. YUKOS stocks immediately fell 12.34 percent on the MICEX.

On Friday, Russian stocks opened lower. YUKOS plunged by more than 12 percent in the first ten minutes of trading on the MICEX. RAO Unified Energy Systems of Russia and Norilsk Nickel dropped 1.8 percent in early trading, and LUKoil lost 1.5 percent.

On the RTS, YUKOS slumped 16.87 percent, RAO UES fell 6.56 percent, and Surgutneftegas dropped 4 percent.

Russian traders expect further falls, Ivan Dolzhenko, CEO of Investment and Financial Consulting, told RBC TV. In his opinion, the inflow of foreign money into the Russian market should not be expected, and domestic demand for stocks is very low. The expert thinks YUKOS will eventually be owned by the state, or it will be sold in parts. “What is happening confirms our worst expectations,” he stressed.

On Thursday, court bailiffs served YUKOS lawyers with a writ of execution on the judgment against YUKOS. June 29, the Moscow Arbitration Court ruled that YUKOS shall pay RUR 99.4bn in back taxes and fines for 2000. YUKOS has five days to pay the claim.

On July 2, the Arbitration Court of Moscow rejected YUKOS’s appeal and upheld the ruling of April 15, 2004, to freeze the company’s assets. On April 15, the Moscow Arbitration Court banned YUKOS from selling or mortgaging its assets including shares, at the request of the Tax Ministry. It also banned any changes to YUKOS’s register of shareholders related to operations with the company’s stocks.